BofA sellout gives Hawaii
tougher No. 3
American Savings gets better branch
By Rick Daysog
and ATM access from the deal
Star-BulletinSize. Choice. And convenience. Those are the driving forces behind American Savings Bank's $96 million acquisition of Bank of America's local retail operations.
Over the Memorial Day weekend, Hawaiian Electric Industries Inc.'s savings and loan subsidiary signed an agreement to acquire Bank of America's local operations, a deal that will transform the thrift into the state's third-largest financial institution with $5.4 billion in assets.
The deal, likely to be completed next year, will make American Savings a stronger player in Hawaii's banking industry by allowing it to offer additional products and services, the company said. It adds 39 branches to American Savings' 47-branch network. Seven of the new branches will be on the neighbor islands, giving American Savings a total of 27 neighbor island branches.
"This is positioning us to be a strong competitor in the Hawaii market," said Wayne Minami, American Savings' president and chief executive officer.
"We can compete with the two large banks and we can compete with them on an equal footing."
Pacific Century Financial Corp., the state's largest financial institution with assets of $14 billion, operates 190 branches and offices in Hawaii, the mainland and the Asia Pacific region. Pacific Century has about 130 Bank of Hawaii and First Fed branches statewide. More than 30 of those are on the neighbor islands.
First Hawaiian, with $8.1 billion in assets, owns more than 100 branches, including 37 First Hawaiian Bank branches on Oahu and 23 on the neighbor islands. It also has 12 First Hawaiian Creditcorp offices statewide.
Don Horner, First Hawaiian's vice chairman, said his company will continue to compete aggressively despite increased competition. "We at First Hawaiian have continued to gain market share in recent years ... by providing customer value and saying 'Yes,'" Horner said.
Pacific Century declined to comment.
Besides additional branches, American Savings said the deal will double its customer accounts to about 600,000. That, said Minami, will allow the company to cross-sell American Savings' loan product to a larger audience, giving consumers more choice.
For instance, an American Savings checking account customer could look to the bank to refinance a home, he said.
The deal also greatly expands American Savings' ATM network by adding 170 machines and will allow the company to enter a new niche: seven-day supermarket banking. American Savings currently operates ATMs only at its branches and the machines will make it much more convenient to bank with it.
Minami added that the company will look to expand its grocery store branches. However, American Savings also will close or sell some duplicative or unproductive branches.
The company also has said that its reviewing checking and savings accounts and other accounts offered by Bank of America but has made no decision on how those accounts will be blended into American Savings. Until the deal is complete, consumers should expect no changes in their accounts, Minami said.
